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WASHINGTON/LONDON: The euro plunged to a two-year low against the US dollar on Thursday as comments from European Central Bank President Christine Lagarde were viewed as a sign that the bank was in no rush to raise interest rates.

The single European currency fell to $1.0758, the lowest level since April 2020. It was last down 1.1% at $1.0775.

Lagarde said there was no clear timeframe for when rates would start to rise, adding it could be weeks or even several months after the end of stimulus.

“We’ll deal with interest rates when we get there,” she added.

Earlier the ECB concluded its latest meeting with cautious steps to unwind support and avoided a hard schedule. It confirmed its plans to cut bond purchases, commonly known as quantitative easing, this quarter, then end them at some point in the third quarter.

Against sterling, the euro slid to a one-month low and was last down 0.4% at 82.85 pence.

Lagarde’s comments were “all similar language to the March meeting, except this time around there was no hawkish surprise in the form of a policy tweak,” said Ima Sammani, FX market analyst at Monex Europe.

“Frankly, given how uncertain conditions are at the moment, Lagarde’s caution can be justified, but it is fair to say that markets were expecting a bit more sprinkle after the eventful March meeting.”

In late morning trading, the dollar index, which measures the greenback against six peers, rose 0.8% to 100.57 after earlier hitting 100.76, the highest since April 2020.

The dollar extended gains after data showed US retail sales increased in March, mostly boosted by higher gasoline and food prices.

The battered yen had some respite, making a small recovery from a 20-year low hit against the dollar. It was last flat on the day at 125.80 yen.

More than three-quarters of Japanese firms say the yen has declined to the point of being detrimental to their business, a Reuters poll found.

Other central banks tightened monetary policy, reinforcing expectations of higher interest rates globally.

The Bank of Korea surprised markets with a rate hike, while the Monetary Authority of Singapore also tightened policy, sending the Singapore dollar to its highest since February.

On Wednesday, the Bank of Canada and Reserve Bank of New Zealand both raised rates by 50 basis points, the largest hike for each in around 20 years.

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